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Singapore in Focus 2021
Singapore continues to make significant efforts to further promote the appeal of the Lion City to hedge funds, private equity and other alternative investment managers, and it seems that its strategy is working. Last year’s unveiling of the Variable Capital Companies (VCC) Act has widely been seen in the investment industry as a game-changer, while Singapore’s financial regulator, MAS, recently announced a new partnership between it and the private sector to burnish Singapore’s reputation as a leading full-service asset management and fund domiciliation hub.
This report delves into the impact of these measures on Singapore’s burgeoning reputation as the financial hub for Asia, shining a light on its role in creating a sustainable ecosystem, the growth of its secondaries market, and its position as an asset management and fund domiciliation hub.
Singapore the Asset Management Centre of the Future
By Mark Voumard – The genesis of Singapore’s asset management industry development: 2021 – 2035
It’s 2035 and Jane Lee, a resort hotel executive in Singapore is planning to invest in one hedge fund and two mutual funds, all Variable Capital Company’s (VCC) managed by asset managers based in Singapore, Asia’s largest asset management centre, fund domiciliation hub and private banking nexus. Her AI digital PA navigates to her personal, cloud based, financial portal reviewing the latest return data and scans her personal, long term financial plan and goals, leading to approval, and Jane is ready to invest. Her AI program using U-Reg, an advanced KYC/AML software, locks into each manager’s online application and completes each subscription form in 30 seconds, supplying certified true copies with a digital watermark of her passport, proof of address and proof of Accredited Investor status. Each fund manager’s AI system check and verify all the information resulting in approval within five minutes, with Jane’s AI PA remitting funds in Singapore’s digital currency, the SG-ED.
Global economic shift to Asia
In 2021, a Regional Comprehensive Economic Partnership (RCEP) pact (and the world’s largest free trade agreement) was signed, focusing on reducing trade barriers in Asia. By 2030, it was adding USD220 billion a year to world incomes and USD560 billion to world trade. In 2031, China surpassed the US as the world’s largest economy and by 2033, 42 per cent of world GDP and 36 per cent of global consumer spending was generated in Asia.
The period 2022 to 2029, saw technological innovation and the rapid adoption of technology by governments in Asia; in particular, in Singapore, where the city state ramped up subsidies and multiyear training of the local workforce, to truly transform itself into a knowledge economy. The adoption of digital tools and processes boosted productivity growth and unleashed a wave of innovations across many domestic sectors including finance and asset management.
Strong growth as an asset management and fund domiciliation hub
By 2035, global Assets Under Management (AuM) grew from USD89 trillion in 2021 to USD240 trillion (CAGR 6.84 per cent). By 2035, AuM across the asset management industry in Singapore rose from USD3.5 trillion to USD20 trillion (CAGR 14.34 per cent), second globally as a fund hub, only to Luxembourg USD22 trillion (CAGR 11.27 per cent), followed by Shanghai with USD15 trillion. Whilst investment vehicles established and operated in Luxembourg and Singapore are used to make regional (pan-EU and pan-Asian) investments respectively, in the case of Shanghai, most of the capital and assets are domestic, not cross border. In the region, both Australia and Japan have built large pools of domestic capital in domestic vehicles but with a focus still on primarily investing in domestic assets.
Singapore’s growth spurt began in the early 2020s with the launch of the VCC in January 2020. Singapore was already one of the leading asset management and private wealth centres in Asia experiencing double digit CAGR in AuM when it launched the VCC to bring funds onshore where they could be serviced locally and to win a percentage of the global fund domiciliation business.
Prior to the VCC launch, 85 per cent of the money managed from Singapore was in Cayman structures and 4 per cent in Luxembourg structures. 500 VCCs were launched in the first two years (during the first Covid pandemic) and as of August 2035 there are 7,000 VCCs with 70 per cent of the money managed from Singapore now in Singapore domiciled structures. Globally, the trend to onshoring continued through the 2020s, boosted in part by the rollout of the global minimum tax in 2023 that was extended to the financial industry, hitherto exempt, in 2028. Whilst some US-based managers continue to use Cayman and increasingly Delaware vehicles, the rest of the world, over time, shifted to either Luxembourg, despite the partial break-up of the EU in 2027, for European investments or Singapore for Asian investments.
Between 2021 and 2035, Singapore’s share as a percentage of global AuM increased from 3 per cent to approximately 9 per cent and the number of licensed asset managers based in Singapore increased from 1,050 to 2,950. By 2028, the Asian Regional Fund Passport (ARFP), a cross border, online system allowing residents of 15 countries across Asia to access funds domiciled and or managed in each of the other 14 countries, had overcome prior obstacles and was in full swing. By 2029, Asia accounted for 75 per cent of all the venture finance in the world versus 3 per cent in 2005. With a focus on political stability, the rule of law and the strongest IP rights in Asia, Singapore became the regional headquarters for many of the Asian recipients of this wave of money.
Use of AI by hedge funds
XAI or Explainable Artificial Intelligence (a term created by DARPA) allows humans to understand how and why AI generates a specific set of results and allows managers to be able to explain to investors exactly how alpha is being generated. Singapore bet the house on this technology providing significant government funding for hedge funds utilising XAI, leading to Singapore becoming a world-leading XAI hub.
Introduction of digital currency
The MAS issued its own digital currency, the SG-ED in 2025, which further cemented Singapore’s position as a centre for crypto and blockchain investing and trading. That said, as more and more central banks issued their own digital currencies (CBDCs) with China leading the charge in 2022 issuing an ‘e-yuan’ and the US belatedly issuing its own USD-ED in 2028, the growth of independent crypto currencies such as Bitcoin fell dramatically. The use of the SG-ED prompted previously unbanked assets from across Asia to shift into its rigorous financial system and improved speed, cost, and transparency of cross-border payments.
The talent bottleneck
The knowledge economy created tremendous demand for skilled workers with the numbers in the financial industry jumping to 700,000 in 2034 from 200,000 in 2014 and the finance industry contributed to 48 per cent of Singapore’s GDP in 2034 versus 19 per cent in 2021. The path was not easy with a talent bottleneck developing in the asset management industry between 2020 and 2022. A subsequent significant increase in the number of global asset managers basing themselves in Singapore, bringing with them international expertise, beneficial for knowledge transfer and upskilling of the local workforce, combined with strong support by the MAS for academic programs and training provided by the industry, resulted in a significant expansion of financially trained workers.
Like this article? Sign up to our free newsletter Author Profile Related Topics Digital Assets Technology & software solutionsSingapore: Addressing climate change and sustainability
By Ashmita Chhabra – With the United Nation’s COP 26 summit approaching, the need to do more to address climate chance is once again in focus. As a key financial services hub in Asia, Singapore has an important role in the development and integration of sustainable finance practices into the real economy. The capital market’s ability to drive meaningful change by encouraging disclosure, stakeholder engagement and innovative green financing initiatives are all part of Singapore’s commitment.
Developing a sustainable ecosystem
The Monetary Authority of Singapore (MAS) intends to make sustainable finance a defining feature in Singapore’s role as a global financial centre. Its inaugural sustainability report, the first of its kind by a central bank in Asia, outlines plan to strengthen and develop a green finance ecosystem, build a climate-resilient reserves portfolio, while reducing its own carbon footprint. Those efforts include testing the climate resilience of its official reserve investments and deploying USD1.8 billion to five asset managers under its Green Investment Programme (GIP) to manage new mandates focused on climate change and the environment.
The investment management industry has also been rapidly developing policies and framework to meet demand and major state-led institutional investors have followed global trends in ESG adoption, with themes such as carbon transition now core to investment decision managing. While much of the disclosure requirements remains voluntary, MAS expects financial institutions operating in the city-state to make climate-related disclosures from June 2022, in line with international frameworks, including the TCFD recommendations.
The EU introduced the first part of its Sustainable Finance Disclosure Regulation in March and plans to have in place more stringent measures next year requiring asset managers investing in the region to produce comprehensive reports, with quantitative ESG metrics around their investments, including carbon emission data points. Regulators in the US and the UK are set to push through similar rules.
Preparing to deliver
Having the right tools to provide accurate and meaningful qualitative and quantitative data, like through the use of Apex Group’s new Carbon Footprint Assessment solution, will be key to financial sector firms delivering on those regulatory and fiduciary demands. Only by obtaining a clear picture of their ESG performance – both as a business and across their portfolio companies – can they create an action plan that helps ensure they play their part in building a more sustainable future.
Recent research by Apex Group shows that many asset managers in Singapore recognise this responsibility; however, the commitment to act leaves room for improvement. 94 per cent of private equity firms in Singapore agreed that climate change is an urgent issue, with 84 per cent agreeing they and their investments should take greater responsibility. Yet less than half of respondents (40 per cent) measuring their own carbon footprint, and only 32 per cent that of their investments.
Encouragingly, however, all the private equity firms from Singapore that took part in the study said they have plans to be carbon neutral, with 44 per cent already having a well-defined process underway, and 56 per cent planning to do so in the future. Part of that commitment is down to the fact that pressure is mounting on the financial sector, not least from regulators.
Like this article? Sign up to our free newsletter Author Profile Related Topics ESG & Responsible InvestingThe global secondaries market: What Singapore-based sponsors can learn
By Tom Lin and Morgan Shubin, Clifford Chance – It has become fashionable to say that secondary transactions are now ‘mainstream’, with some market participants pointing to the flourishing GP-led segment of the market as a ‘fourth leg’ option for liquidity alongside conventional exit routes for PE assets (i.e. sale process, IPO or recapitalisation). That might not be necessarily a perfect characterisation, though we suspect it might be to a degree with some nuance. However you might characterise it, the growth in deal activity (market commentators expect transaction value to exceed USD100 billion for the first time in 2021), extraordinary fundraising, the concerted expansion of global managers into the strategy (whether through acquiring established platforms or team build-outs) all points toward one direction of travel: bigger, more competitive and more complex.
A growing market
The pandemic has supercharged the growth in transactions led by the sponsor, or GP-led secondaries to use jargon, involving single assets or concentrated portfolios with a crown jewel. This was driven in part by the outlook of an uncertain exit environment as the macroeconomic shock of the pandemic first took hold, coupled with (and giving way to) a recalibration of sponsors’ (and investors’) expectations on value and growth potential resulting from the market dislocation. Tailwinds driving the accelerated growth potential of certain asset classes resulted in GPs doubling down, whilst headwinds facing other asset classes resulted in GPs looking to extend holds on assets with strong fundamentals to undertake strategic pivoting.
Our perspective at Clifford Chance is perhaps unique in that our ‘boots on the ground’ capital solutions team in Singapore is lucky enough to run deals across European and APAC opportunities. Whilst the market opportunity in APAC has historically been small by comparison (it’s commonly accepted that APAC represents around 5-10 per cent of global secondaries volume), there is cause for optimism in regional activity growth driven by a number of factors. A slowdown in primaries, a backlog of transactions disrupted by the pandemic, and the opportunity for international investors to use a secondary strategy to access mature assets in the region as a means of diversification, are commonly recognised as such factors. In this context, supported by a strong advisory community on the ground in Singapore and elsewhere in the region, more proven GPs are reviewing assets through the secondaries lens which, empirically, has resulted in higher quality GPs bringing deals to the market during 2021.
Learning the lessons
Singapore-based sponsors thinking about entering the secondaries market will be in the privileged position of being able to build on the lessons learned in the US and European secondaries market, allowing for swifter identification of key issues and an ability to refer to ‘market practice’ where relevant and helpful. For example, an issue that has received a lot of attention in global secondaries transactions is how conflicts of interest are managed and, for some market participants, the increasingly robust approach that GPs are taking towards conflicts management. In a GP-led secondary transaction, the sponsor sits on both sides of the trade. One thing we have observed as perhaps the biggest issue in the whole area is validating valuations and LP agitation about the extent to which value was really right. We think LPs are increasingly sceptical about fairness opinions (often commissioned by the LPAC or advisory committee of a fund, around the process of conflict management rather than the actual proposed price) and, as a consequence (and certainly for the concentrated or single-asset deals), they expect to see more market-testing of value with lead secondary buyers being bidders in a market auction akin to a traditional M&A buyout.
In relation to deal terms, careful consideration must be given to the manager’s duties to each of the buying and the selling entities, and how best to evidence the mitigation of conflicts of interest to the investors in each vehicle. This may be particularly acute where a sponsor is asking for a staple, or when bringing in their current flagship fund to co-invest alongside the secondary vehicle (a trend we have seen emerge as the equity cheques required now routinely exceed what can be put together with only one or two lead underwriters of a deal – not to mention the ‘strong buy signal’ that comes about with a sponsor’s flagship fund coming into a deal). What should the liability package look like and does that pass muster as a reasonable allocation of risk from a buy-side and a sell-side perspective? How do you price in an identified but unquantifiable risk (e.g. an ongoing tax or regulatory investigation)? How do you structure rollover election options when pressured to not offer a ‘status quo’ option for the existing investors by over-subscribed buy-side demand from lead secondary buyers?
Ready to go
Our view is that, with the benefit of deal trends and sentiment from global transactions, the Singapore ecosystem is particularly well set up (and we would say is more than ready) to support significant growth of the secondary strategy in the immediate timeframe for pan-APAC opportunities. The increasing availability of W&I insurance for these types of deals and access to the underwriting markets from Singapore-based brokers, is one example. As a financial hub, the private capital participants on the ground (experienced placement agents, counsel and lenders) in Singapore will support managers seeking to move into, or increase their presence in, this segment of the market. The key, as always, is proactively planning transactions with transparency in mind and adapting deal technology developed globally to local market conditions.
Like this article? Sign up to our free newsletter Author Profile Related Topics MarketsSimilarweb named Best Alternative Data Provider at Hedgeweek Americas Awards 2021
Similarweb, a digital intelligence company, has been named the Best Alternative Data Provider in the Hedgeweek Americas 2021 Awards. This is a first-time nomination and win for Similarweb, which earned the award for its Investor Intelligence service, launched in late 2018.
Compiled in conjunction with Bloomberg, the Hedgeweek Americas Awards recognise excellence among hedge fund managers and service providers in the Americas across a wide range of categories. For the service provider categories, short-listed firms were based on a widespread survey of more than 400 fund managers and other key industry participants. Voting for the eventual winners was then conducted through an online poll of Hedgeweek readers.
"We are thrilled to be recognised for the value that our digital intelligence brings to the investor community," says Ed Lavery, Director of Investor Intelligence at Similarweb. “Having visibility into the online presence and behaviour of private and public companies has never been more critical, and we are honored that Similarweb has been spotlighted as a leader in the hedge fund ecosystem.”
Similarweb's Investor Intelligence provides visibility and insights into the digital performance of private and public companies with a digital presence, covering over 100 million websites and 4.7 million apps across more than 210 industries and 190 countries. Similarweb Investor Intelligence has grown rapidly over the last three years, and is used by hundreds of investment funds in over 25 countries, quickly becoming one of the investment industry’s go-to sources of alternative data.
Like this article? Sign up to our free newsletter Author Profile Related Topics Awards Services Research & AnalyticsPreqin appoints new CEO
Preqin, a specialist in alternative assets data, tools, and insights, has appointed Christoph Knaack, currently the company's Chief Strategy & Product Officer, as CEO as of 1 January, 2022.
Knaack will focus on leading Preqin through its next growth phase, as the company moves toward serving its customers through the entire private market investment lifecycle — from fundraising and investor relations to deal origination, due diligence and portfolio monitoring.
From 2022, Preqin’s founder and current CEO, Mark O’Hare, will continue his active involvement as a member of Preqin’s Board of Directors, and as the company’s principal shareholder, supporting Preqin’s executive team with strategic guidance, as well as engaging with customers, partners and other stakeholders in the market.
Knaack joined Preqin in 2020. He has since served on Preqin’s Executive Committee where his in-depth understanding of the alternatives industry has proven invaluable in further advancing the company’s overall product and corporate strategy. Before he joined Preqin, Christoph was well-recognised in the investment world through his roles at hedge fund Davidson Kempner, private equity firm Kohlberg Kravis Roberts and in investment banking at Morgan Stanley.
Preqin currently supports more than 170,000 professionals by providing them with the most comprehensive alternative assets data and insights. The firm is currently going through a strong growth phase, with more than 1,000 staff across 14 offices globally. Under the leadership of Mark O’Hare, Preqin has become the global leader in alternative assets data, continuously focusing on innovation, technology and customer centricity.
In August 2021, Preqin took the next step in the company’s evolution with the acquisition of Colmore, a leading private markets technology, services and administration business. In October, Preqin launched major updates to its ESG Solutions, which provides private market participants with an indispensable 360-degree view of environmental, social, and governance (ESG) risk, impact and opportunity. Preqin has an ambitious product roadmap in place as the company continues to provide unmatched service and data-driven intelligence to its customers.
O’Hare says: “It is an exciting time for Preqin and the alternative assets industry in general, and as such it is a perfect time to transition to a dynamic new leader. Since he joined Preqin, Christoph has brought clarity and focus to our product and corporate strategy, with tremendous results. Thanks to his deep industry knowledge, customer focus and fresh perspective, Christoph is the right person to lead Preqin going forward — with the full support of the board, the executive committee and our amazing team across the globe.”
Knaack adds: “I am truly honoured to lead Preqin through its next phase of growth. Preqin is an incredible business and Mark’s vision in building it has truly changed the alternative assets industry. I want to thank Mark for his leadership over the years, for his personal mentorship and guidance, and for his and the board’s confidence in me. Private markets are evolving, and so is Preqin, and I am very excited about the opportunities ahead of us.”
Like this article? Sign up to our free newsletter Author Profile Related Topics Moves & AppointmentsApex supports Absolute Investment Advisers as Convertible Arbitrage Fund exceeds USD500m
Absolute Investment Advisers (Absolute), a long-term client of the Apex Group (Apex), has closed its acquisition of Mohican Financial Management (Mohican).
Absolute is the fund adviser to the Absolute Convertible Arbitrage Fund (ARBIX) while Mohican Financial has been the Fund’s subadviser. The strategic transaction brings the two firms together.
Apex has worked with Absolute to support fund launches and provide ongoing fund services since its foundation in 2004. Absolute provides access to non-traditional investment strategies in mutual fund structures and continues to prove the value offered to investors by the asset class. In this case, the Absolute Convertible Arbitrage Fund (ARBIX) was launched on 14 August, 2017 with USD25 million in legacy assets and a 15-year track record. Fund assets under management have since grown to over USD525 million. Earlier this year ARBIX was named Lipper’s 2021 Best Alternative Equity Market Neutral Fund ranked one of 19 as of 11 March, 2021 for the three-year period.
“Convertible arbitrage is increasingly attractive to investors since it can complement either the fixed income or alternatives sleeve of a diversified portfolio. It may provide investors an opportunity for a moderate return with relatively low volatility, which is increasingly difficult to find in the current low interest rate environment. Convertible Arbitrage is, in our opinion, one of few strategies today that may consistently offer the potential for alpha and the team from Mohican has the experience, knowledge, and track record to execute on the opportunities present in the convertibles market,” explains Brian Hlidek, Managing Principal Sales & Marketing at Absolute.
Chris Koons, Head of Mutual Fund Services at Apex Group, says: “We truly value the collaborative relationship we have built with Absolute over the last 15 years, and are delighted to see such impressive growth with their latest product. We enjoy working on innovative products and our expertise and customized approach is well suited to Absolute’s service needs, in the past, present and future.”
David Faherty, General Counsel and CCO at Absolute, adds: “We have had a great working relationship with the Apex team who have consistently provided us with high quality fund administration, accounting, transfer agency and compliance services. Apex advice and support have played a vital role in the growth and success of ARBIX.”
Trading Technologies to be acquired by 7RIDGE
Trading Technologies International, (TT), a global provider of high-performance professional trading software, infrastructure and data solutions, is to be acquired by 7RIDGE, a specialised growth equity firm invested in transformative technologies.
7RIDGE will fuel Trading Technologies’ organic growth and enable the firm to make targeted strategic acquisitions in the future. Cboe Global Markets, Inc (Cboe: CBOE) and Singapore Exchange (SGX), who are among the limited partners of the fund managed by 7RIDGE, have voiced their support of the transaction. Terms of the transaction, expected to close before year-end subject to regulatory approvals, have not been disclosed.
7RIDGE’s acquisition of Trading Technologies recognises the company’s 27-year leadership position in derivatives trading software, the value of its new state-of-the-art Software-as-a-Service (SaaS) platform, TT, and the talent of Trading Technologies’ global team, which spans 13 offices across four continents. Under this new ownership, Trading Technologies will remain independent and focused on delivering innovative, enterprise-wide solutions for institutional and professional trading.
Tim Geannopulos, Chairman of the Board and CEO of Trading Technologies, says: “We’ve been in search of the right strategic partner to help Trading Technologies achieve the tremendous potential of our pioneering new technology platform and accelerate the expansion of the business and product roadmap. Maintaining the firm’s independence will allow us to retain the incredible talent within our organisation and further strengthen our relationships as a valuable ally to our clients, our partners and the industry. We’re excited that 7RIDGE and its strategic limited partners including global exchanges Cboe and SGX believe in the future of our company and our vision of becoming the operating system of capital markets.”
Shortly after the acquisition closes, it is expected that Geannopulos will relinquish his current role while remaining actively engaged with the company. It is intended that Keith Todd will then be appointed CEO of TT to lead the company as it embarks on this next growth phase. Todd has over 20 years of industry leadership in financial markets technology with FFastFill, ION and currently KRM22.
Todd says: “Trading Technologies has built an exceptional global client base and great relationships with exchanges all over the world, as well as robust technology and a dedicated, experienced team. The firm has an aggressive roadmap for product and market expansion. I have long been a firm believer in the power of SaaS to deliver to clients better technology, greater cost savings and more efficient use of resources. I’m excited by this opportunity to lead TT into its next transformational phase with its outstanding new SaaS platform and the infusion of growth capital from 7RIDGE.”
Carsten Kengeter, Founder of 7RIDGE, says: “We thank TT’s shareholders for selecting us and look forward to accelerating the company’s dedicated contribution to its clients’ and users’ success. The firm has built the market-leading SaaS-based, modular, multi-tenant platform for professional derivatives trading that will bring new efficiencies and strength to the global financial system. Our own operating experience as well as that of our limited partners will strengthen TT’s position as the operating system of capital markets.”
TT was advised on the transaction by Broadhaven Capital Partners and Sullivan & Cromwell LLP.
Bitfinex launches multiple trading templates
Bitfinex, a digital token trading platform, has launched customisable trading templates, enabling each user to create their own unique trading experience.
Bitfinex customers can now tailor their trading portal according to their view on the market. Trading templates can be formulated to meet the specific requirements of a user, facilitating the execution of sophisticated trading strategies. Each user can choose between multiple widgets from a list of tools, including Trading Charts, Depth Charts and Bitfinex Pulse.
“We’re delighted to enable our growing user base to further tailor their trading experience according to their unique individual needs with these trading templates,” says Paolo Ardoino, CTO at Bitfinex. “As a platform to trade digital tokens, Bitfinex is in a class of its own and these new features bring to life the professional trading mindset.”
The exciting new feature allows users also to create multiple custom layouts, which can then be saved and used across various trading pairs, allowing access to faster analysis when trading.
Like this article? Sign up to our free newsletter Author Profile Related Topics Digital AssetsITERAM makes double hire in alternatives team
ITERAM Capital SA, an independent Swiss alternative asset manager, has made two appointments to its alternative team.
ITERAM provides investors access to differentiated alternative investments with the potential to generate stable and consistent uncorrelated returns.
Manuel Garzelli, ITERAM’s CEO, says: "Moïra and Marouane will further enhance our alternative investment expertise and will be invaluable contributors to ITERAM’s growth ambition as well as serving our clients with best-in-class alternative investment solutions."
Marouane Daho joined ITERAM Capital in August 2021 as investment and research analyst within the team that oversees investments across hedge funds, alternative UCITS and private markets. He is responsible for analysing, selecting and monitoring alternative fund managers and actively participating and contributing with investment ideas at the investment committee. Daho reports to portfolio managers, Manuel Garzelli and Marc Sbeghen. Daho started his career at Credit Agricole Corporate & Investment Bank before joining Lyxor Asset Management as a Hedge Fund analyst in 2015. Prior to joining the firm, Daho was working as a hedge funds and private equity investment analyst and was a member of the investment committee at Lera Capital in Geneva. Daho graduated from NEOMA Business School with a Master's in Management and is a CAIA charterholder.
Moïra d’Anterroches joined earlier this year, in March 2021, and is responsible for the operational due diligence on alternative investments covering hedge funds, venture capital, private debt and liquid alternatives. D’Anterroches brings a deep knowledge of financial markets and financial products with expertise in quantitative and qualitative market risk analysis. She started her career in 2003 as investment risk analyst for asset-backed securities, corporate debt and credit derivatives at Natixis Capital Markets and Lehman Brothers in New York before joining Nestlé Capital in Vevey as investment risk manager. Most recently, d’Anterroches was an investment analytics consultant at Groupe Heller. D’Anterroches graduated with a Master’s of Arts in Mathematics of Finance from Columbia University, a Master’s in Economics from University of Geneva and is a FRM charterholder.
ITERAM has assets under management of USD450 million split across liquid and illiquid alternative strategies. The company offers investors innovative and high-quality alternative investment solutions that encompasses the full alternative spectrum from financing and direct investments to multi-manager portfolios, across private markets and hedge funds.
Like this article? Sign up to our free newsletter Author Profile Related Topics Moves & AppointmentsNew quant multi-manager AFBI secures strategic investment from New Holland Capital
AFBI, a new quantitative multi-manager platform led by former Tudor and Millennium portfolio manager Pierre-Yves Guillo, has secured an anchor investment from alternative investment seeder New Holland Capital.
Established in May this year, AFBI looks to generate uncorrelated returns across a diverse set of liquid quant strategies, using alternative data, proprietary portfolio construction and robust risk management techniques.
Specifically, the Florida-based firm’s strategies include long/short equity investing around digital customer traffic, systematic investments in Chinese commodities futures, real-time mining of alternative datasets in regional macro markets globally, and short-horizon low-latency FX trading.
“New Holland Capital provided us with a sizeable investment and a meaningful operating budget which allowed us to ramp up quickly with respect to technology, data and PMs,” Guillo said of the investment and strategic commitment, which sees the New York-based firm provide significant trading and working capital to AFBI.
Guillo added his firm – which started trading operations in September – will benefit from New Holland’s product structuring expertise and entrepreneurial guidance in the alternative investment industry.
“There is strong demand for high-capacity quantitative macro alpha, and we believe we are competitively placed to deliver it."
New Holland Capital looks to generate alpha across a diverse profile of managers, typically seeking out seeding and co-investment opportunities among smaller and earlier-stage managers, as well as catalyst-driven opportunities with more established firms.
Established in 2003, it was initially an exclusive, non-discretionary advisor to Dutch pensions for alternative investment allocations. In 2020, it expanded to a multi-client model and now manages more than USD20 billion in absolute return strategies for institutional clients.
“AFBI has a highly-skilled and experienced management team with an impressive track record of investing across different market cycles, which creates an attractive opportunity to provide our institutional clients with portfolio diversity and high-quality risk-adjusted alpha,” New Holland Capital CEO Scott Radke said of the partnership.
Like this article? Sign up to our free newsletter Author Profile Hugh Leask Employee title Editor, Hedgeweek Twitter Linkedin Related Topics Deals & Transactions Acquisitions InvestmentsCTAs on track to finish October with a flourish
CTAs and trend-following hedge funds have strengthened their returns as October draws to a close, with recent gains pushing the sub-sector’s year-to-date returns further into double-digit territory.
With just two months left until the end of 2021, Société Générale’s main broad-based CTA Index – a key industry benchmark tracking the daily returns of a pool of 20 of the largest CTAs – is now up 10.56 per cent for the year, having gained 3.20 per cent since the start of this month.
Managed futures funds have continued to thrive on strong directional signals across commodities and currencies, with recent surges in oil and gas prices helping managers extend September’s 0.58 per cent rise. Earlier, the sub-strategy had endured what SocGen earlier described as a “challenging environment” during August, when CTAs slipped 0.29 per cent.
Trend-following hedge funds have fared even better in recent weeks. SocGen’s SG Trend Index – a daily return index measuring the performances 10 of the biggest trend-following managers – is up almost four per cent in October. That advance – almost double the 1.85 per cent return made in September – has pushed year-to-date returns for trend-followers up to some 14.8 per cent overall.
Meanwhile, short-term CTAs – which have struggled to notch up meaningful returns lately thanks to the recent global stock market reversal and renewed volatility stemming from inflationary pressures – are set to end this month on a surer footing.
The SG Short Term Traders Index, which ended September largely flat at 0.15 per cent as a result of uneven market momentum, has added 2 per cent so far this month. The benchmark, which provides a returns snapshot of CTAs and global macro managers with 10-day trading windows, is now up 2.35 per cent since the start of January.
Like this article? Sign up to our free newsletter Author Profile Hugh Leask Employee title Editor, Hedgeweek Twitter Linkedin Related Topics Markets Results & performance Investing in Hedge FundsT Rowe Price to acquire alternative credit manager Oak Hill Advisors in USD4.2bn deal
T Rowe Price Group is to acquire alternative credit manager purchase Oak Hill Advisors and certain other entities that have common ownership for a purchase price of up to approximately USD4.2 billion.
USD3.3 billion is payable at closing, approximately 74 per cent in cash and 26 per cent in T Rowe Price common stock, and up to an additional USD900 million in cash upon the achievement of certain business milestones beginning in 2025.
The purchase price includes the retirement of OHA debt outstanding at closing. Excluding amortisation of intangibles and the expense impact of the earn-out, the transaction is expected to be accretive to T. Rowe Price diluted earnings per share by a low-to-mid single digit percentage in 2022.
OHA, a leading alternative credit manager, will become T Rowe Price’s private markets platform, accelerating T Rowe Price’s expansion into alternative investment markets and complementing T. Rowe Price’s existing global platform and ongoing strategic investments in its core investments and distribution capabilities. Alternative credit strategies continue to be in demand from institutional and retail investors across the globe seeking attractive yields and risk-adjusted returns.
With USD53 billion of capital under management as of 31 July, 2021, across its private, distressed, special situations, liquid, structured credit, and real asset strategies and more than 300 employees in its global offices, OHA has generated attractive risk-adjusted returns over its more than 30-year history. OHA’s performance, its global institutional client base, and the positive industry backdrop have positioned it to raise USD19.4 billion of capital since January 2020.
Bill Stromberg, chair of T. Rowe Price’s Board of Directors and chief executive officer, says: "While we are committed to our long-term strategy to grow our business organically, we have also taken a deliberate and thoughtful approach to considering adding new capabilities through acquisitions that advance our business strategy. OHA meets the high bar we have set for inorganic opportunities, and their proven private credit expertise will help us meet our clients’ demand for alternative credit.”
Rob Sharps, T Rowe Price president, head of Investments, and group chief investment officer, adds: “OHA and T Rowe Price share organisational cultures that focus on long-term investment excellence and delivering value for clients and that are grounded in collaboration, trust, and integrity. As we bring together complementary capabilities and distribution, we can capitalise on growth opportunities for new product development that add value for our clients and stockholders. We share a vision with OHA’s seasoned management team to build a broader business in private markets by combining their specialty in alternative credit with our global scale.”
Like this article? Sign up to our free newsletter Author Profile Related Topics Deals & Transactions Acquisitions Finance & InsuranceDimensional appoints Head of Responsible Investing
Dimensional Fund Advisors has appointed Jim Whittington as Head of Responsible Investment.
Joe Chi, who will retire at the end of the year. Additionally, the firm named Lacey Huebel as Head of Responsible Investment, North America. Both appointments are effective 1 November.
Whittington brings valuable experience to the role, having served as a Senior Portfolio Manager and Vice President in the firm’s London Office, in addition to his work as a member of Dimensional’s Investment Stewardship Committee. For years, he has been on the front lines of Dimensional’s Environmental, Social, and Governance (ESG) initiatives in Europe, the Middle East, and Africa, working with clients, managing portfolios, and representing the firm with industry organisations.
Like Whittington, Huebel brings a wealth of knowledge to her new role, having managed the firm’s social and sustainable fixed income portfolios since their inception. She frequently represents Dimensional on ESG matters both with clients and at conferences. In addition to her new role, Huebel will continue to serve as Portfolio Manager and Vice President.
“These appointments will further our decades-long commitment to sustainability,” says Gerard O’Reilly, Co-CEO and Chief Investment Officer of Dimensional Fund Advisors. “For nearly 20 years, we have managed robust commingled ESG investment solutions on behalf of clients. During that time, informed by the work of leading academics and climate scientists, we conducted extensive research into ESG considerations, developed a reliable approach to analysing and integrating ESG data, built innovative strategies that take environmental and social considerations into account, and designed a systematic approach that enables effective stewardship activities for portfolios that hold thousands of companies. More recently, Dimensional was among the first in its industry to have its worldwide operations certified Climate Neutral by leading climate solutions provider South Pole. We are confident that Jim and Lacey will build on the strong foundation Joe helped establish here.”
Prior to joining Dimensional, Whittington served in a series of leadership roles in London and Hong Kong with various financial firms. He received a BA with honours from the University of Oxford and an MBA from China Europe International Business School.
Huebel previously worked on Dimensional's Investment Analytics and Data team managing fixed income reporting. She has two master’s degrees—an MS from Kansas State University and an MA from the University of California, Santa Barbara. She earned her BS from Texas State University, San Marcos.
Like this article? Sign up to our free newsletter Author Profile Related Topics ESG & Responsible Investing Moves & AppointmentsVIA AM supports Katingan Mentaya carbon offset project via carbon neutral share class offering
VIA AM, a Paris-based asset manager specialised in systematic investment strategies, is supporting the Katingan Mentaya Project through the recently launched VIA Smart-Equity Europe Fund’s Carbon Neutral share classes.
The objective of these share classes is to compensate for greenhouse emissions associated with companies held in the portfolio, through carbon offsetting projects.
The Katingan Mentaya Project aims to protect and restore 157,875 hectares of peatland ecosystems on the island of Borneo in Indonesia, provide local communities with sustainable sources of income and ultimately fight against global climate change. This is the world’s largest emission reduction forest project of its kind, avoiding around eight million tons of carbon dioxide (CO2) being released in the atmosphere per year, equivalent to taking 2,000,000 cars off the road.
Peat swamp forests are incredibly carbon-rich and, by preventing the conversion of natural forests to plantations, the project avoids the emission of nearly half a billion tones of CO2 in the atmosphere. The area protected is also rich in biodiversity, home to more than 4,000 orangutans alongside twelve other endangered species.
Another key aspect of the project is financing sustainable development and agricultural projects in the 34 villages surrounding the project area, with hundreds of people receiving training as part of the project’s activities, as well as improved access to education.
VIA AM is committed to neutralising greenhouse emissions of its portfolio holdings and delivering related benefits against wider Environmental, Social and Governance (ESG) criteria, such as the funding of projects fighting against poverty or preserving biodiversity. The compensation effort is shared: the investor pays slightly increased management fees (+ 0.05 per cent), while VIA AM reduces its margin by an amount at least equivalent to this.
The Katingan Mentaya Project has been selected in partnership with Judo Cares, an independent specialist, advising VIA AM on choosing the best carbon offsetting programmes.
Laurent Pla, Co-Founder of VIA AM and Fund Manager, says: “While we remain focused on maximising long-term returns for our investors, we understand how active management can have a positive impact on combating climate change challenges. Together with our partners at Judo Cares, we have selected the Katingan Mentaya carbon offset project, not only for its effective carbon neutral approach, but also for its commitment towards preserving biodiversity and supporting local communities.”
William Blair Investment Management adds Absolute Return Currency Fund to SICAV range
William Blair Investment Management (WBIM) has launched an Absolute Return Currency SICAV strategy, which maintains long and short exposures across a broad universe of currencies with a view to profit from FX movements.
Employing an actively managed approach, the Absolute Return Currency Fund will include exposures to more than 30 currencies from developed and developing economies.
The portfolio will be managed by WBIM’s Dynamic Allocation Strategies (DAS) team, overseen by Brian Singer, CFA, Partner, Portfolio Manager and Head of the DAS team, and Thomas Clarke, Partner and Portfolio Manager.
The Fund aims to act as a diversifying complement to traditional and alternative portfolios, with a return profile expected to be uncorrelated to equity and bond markets over the longer-term. The team adopts a top-down fundamental investment approach, focusing on expected changes in exchange rates and an assessment of currency valuations, aiming to exploit value to price discrepancies while seeking an attractive return/risk profile.
The Absolute Return Currency SICAV is the thirteenth William Blair strategy to be launched for global investors and the second managed by the DAS team (Dynamic Diversified Allocation). As of 30 September 2021, the company manages USD4.28 billion of assets within its SICAV across Emerging Markets Growth, Emerging Markets Leaders, Emerging Markets Small Cap Growth, Emerging Markets Debt Hard Currency, Emerging Markets Debt Local Currency, Dynamic Diversified Allocation, China A-Shares Growth, Global Leaders Sustainability, Global Leaders, US Small-Mid Cap Growth, US Small-Mid Cap Core, and US All Cap Growth SICAV vehicles.
Brian Singer, CFA, Partner, Portfolio Manager, and Head of William Blair’s Dynamic Allocation Strategies (DAS) Team, says: “The Absolute Return Currency strategy seeks to provide investors with the potential to benefit from positive returns over a market cycle that are expected to be uncorrelated to equities and bonds, complementing traditional portfolio allocations through an absolute return approach. We believe active currency capabilities can improve portfolio efficiency through return enhancement and risk mitigation.”
Thomas Clarke, Partner & Portfolio Manager, Dynamic Allocation Strategies (DAS) Team, adds: “The Absolute Return Currency strategy builds on our team’s multi-decade approach to active currency management. While it has been our experience that our currency management has delivered consistent performance in a variety of environments over that time, we believe the current environment of low yields and many equity segments appearing fully valued make a diversified approach like the one embodied within Absolute Return Currency especially attractive.”
Horizon appoints Senior Business Development Manager for EMEA region
Horizon Software (Horizon), a SaaS provider of electronic trading solutions and algorithmic technology, has appointed Stéphane Sebah as Senior Business Development Manager, as part of its growing EMEA sales team.
Sebah brings with him over eighteen years of solid experience in the financial sector and will be tasked with addressing the markets’ challenges efficiently by accelerating the business growth of Horizon software in the region.
Horizon has witnessed a rapid growth in the EMEA region, which is an important development goal for Horizon moving forward. Having previously worked as a sales broker in the European indices for 10 years at various financial institutions, including Square Global Markets and GFI Securities Limited, Stephane’s experience will enable him to bolster the EMEA sales team and provide insightful management as the business continues to grow. With a firm reputation, alongside a growing global client list, Horizon is striving to offer the best service and improve its business strategies.
Sebah says: “I am extremely pleased to be joining Horizon’s team. Horizon’s reputation in providing world class trading solutions reflects the dedication of the staff in offering the best service and support to the clients. Now that Horizon is witnessing an increasing demand for agency trading, I am proud to be part of this journey and I look forward to the challenges and responsibilities that my new position offers”.
Guillaume Poitevin, Global Head of Sales and Marketing at Horizon Software, adds: “We are delighted to welcome Stéphane into our team. This appointment has a significant importance to Horizon, and it brings us one step closer to our goal of building a strong and dedicated sales team with a clear focus on developing our business strategies in EMEA. This is particularly significant now, as we expand towards agency trading. Stephane’s background in brokerage will add a great value to our team and customers.”
SBAI publishes toolkit for implementation of ESG in different alternative asset classes
The SBAI, a global alliance of alternative investment managers and allocators and custodian of the Alternative Investments Standards, has released the next instalment of its work on Responsible Investment.
A toolkit for asset managers and allocators on the practical implementation of responsible investment in different alternative investment strategies and asset classes. Four strategy specific publications can be found in their Responsible Investment Toolbox.
Much of the guidance provided for implementation of responsible investment is geared towards long only equity portfolios. Whilst there are some elements that are transferable to other alternative asset classes, there are many additional considerations dependent on factors such as asset class, instrument, portfolio concentration, and average holding periods. The toolkit explores these issues along with data considerations in equity long/short, credit, macro, and systematic strategies.
Bradley Belt, Vice Chairman of Orchard Global Asset Management, says: “The SBAI’s work on Responsible Investment is a valuable contribution to the ongoing discussions on integration of ESG risk factors into investment decision-making. In highlighting the need for different approaches, it makes an important distinction between rigorous investment processes which account for any financially material risks, including ESG risks, and pursuing investment strategies with dedicated ESG objectives. This latest SBAI guidance enhances asset manager and allocator understanding of the ESG issues that are relevant to both the strategy and the asset classes traded.”
SBAI’s Responsible Investment work aims to help educate managers and institutional investors around the nuances of ESG and Responsible Investment both when integrating financially material ESG risk into investment and risk management processes, and when running dedicated products with specific ESG objectives.
Maria Long, Research and Content Director of the SBAI, says: “Our mission is to solve for better and improve industry outcomes. Our Working Group discussions have highlighted the importance of allocators and asset managers being able to have conversations that take into account the nuances of different alternative investment strategies. Through collaboration with our community of asset managers and allocators, this toolkit provides guidance on implementing robust and thoughtful frameworks and provides key topics for discussions between asset managers and investors to ensure any ESG objectives are aligned.”
Like this article? Sign up to our free newsletter Author Profile Related Topics ESG & Responsible InvestingAlign's Vinod Paul accepted into Forbes Technology Council
Vinod Paul, Chief Operating Officer at Align, the global provider of technology infrastructure solutions, has been accepted into Forbes Technology Council, an invitation-only community for world-class CIOs, CTOs and technology executives.
Paul was vetted and selected by a review committee based on the depth and diversity of his experience. Criteria for acceptance include a track record of successfully impacting business growth metrics, as well as personal and professional achievements and honours.
“We are honored to welcome Vinod into the community,” says Scott Gerber, founder of Forbes Councils, the collective that includes Forbes Technology Council. “Our mission with Forbes Councils is to bring together proven leaders from every industry, creating a curated, social capital-driven network that helps every member grow professionally and make an even greater impact on the business world.”
As an accepted member of the Council, Paul has access to a variety of exclusive opportunities designed to help him reach peak professional influence. He will connect and collaborate with other respected local leaders in a private forum. Paul will also be invited to work with a professional editorial team to share his expert insights in original business articles on Forbes.com, and to contribute to published Q&A panels alongside other experts.
“It is a tremendous opportunity to join the esteemed technology leaders in the Forbes Technology Council,” Paul comments. “Align’s approach to Managed Services has kept us at the forefront of technology providers in the alternative investment market. The Forbes platform will continue to allow us to address all of the technological, cybersecurity, governance and compliance needs across the financial services and alternative investment management industry and beyond.”
Like this article? Sign up to our free newsletter Author Profile Related Topics Moves & AppointmentsCrestbridge appoints Chief People Officer
Crestbridge has appointed Mike Edward as Chief People Officer.
In his role, Edward will be responsible for the implementation of strategic and practical plans to support Crestbridge’s international growth objectives in order to meet evolving compliance, regulatory and legislative obligations across each of Crestbridge’s eight jurisdictions.
With a career in human resources spanning more than two decades, Edward has particular expertise in devising strategies and techniques to support change and culture management and he originally joined Crestbridge on a consultancy basis, with a remit to manage a series of major HR projects. Prior to joining Crestbridge Mike worked in a number of high-profile banking and financial institutions including six years at a major European-headquartered bank, based in both London and New York, and twelve years at a leading asset management firm in Jersey.
Edward takes over the role from Fiona St Clair-Bolam, who is retiring after a career spanning almost 30 years in human resources. Since joining Crestbridge eight years ago, Fiona has been instrumental in creating and building a people-focussed culture to support the strategy and growth of the business, which now has a headcount of more than 475 people spread over eight locations across the globe. She leaves Crestbridge at the end of the year.
Crestbridge CEO Dean Hodcroft, says: “At Crestbridge our people are the heart of our business and a vital element in achieving our strategic growth ambitions. I’m delighted with Mike’s appointment to the role, where his significant industry experience will be invaluable in leading our HR strategy and helping us drive our evolving Crestbridge vision, building upon the people-focussed culture that Fiona has expertly embedded over the years. Fiona has been a key member of the senior leadership team and has been pivotal in our success to this point and I’d like to thank her for her invaluable contribution, input and counsel.”
Like this article? Sign up to our free newsletter Author Profile Related Topics Moves & Appointments